Welcome to our Monthly Newsletter

In this months’ newsletter we take a look at three areas of interest our Clients have asked about in the last month.
• QCAT - what is it and what does it do?
• Negative interest rates – what are they?
• Suburb spotlight – Mountain Creek.
Plus, a quick summary of the Current Sale and Rental markets for the Sunshine Coast.

QCAT – What is it and what does it do ?
QCAT is the acronym for the Queensland Civil and Administrative Tribunal. It pays an important role in allowing tenancy and other civil disputes to be heard by a Magistrate and have a defined ruling made.
Lots of bond disputes end up at QCAT if no resolution can be made directly between the parties. The Residential Tenancy Authority (RTA) dispute resolution process is the first step but does not have the ability to take sides or make any rulings on the day. Their role is to remain impartial and to assist both parties to communicate respectfully and to try and come to an agreement by hearing both points of view and bringing into play the Legislation. The next step is applying to have a Magistrate hear the case which often has a lead time of 2-3 weeks for an urgent application and longer for a non-urgent application depending on the courthouse closest to the property.
In the event a tenant fails to leave a property at the end of lease and has been issued all the correct notices, the best professional approach is to skip the dispute resolution process and apply immediately to QCAT to have an urgent application heard by a Magistrate. We recently had such a case and received a fantastic outcome for the owner, chiefly because we had all the paperwork and notices documented correctly and understand the Legislation in detail. So, when we hear investor stories of cheap management fees out of the Gold Coast we at least know that when things go astray our Clients can be assured we haven’t cut corners.

 
Negative Interest Rates – what are they ?
Like the name implies, Negative Interest Rates are the fees charged for loaned money from a bank or other financial institution at a rate less than zero. Which means loaning money for housing or business is pretty cheap. At the same time for those with money saved in the bank there is no income being earned off savings.
Banks still make a bit of profit from the money they lend out because they’ve borrowed it for even less; usually from the Reserve Bank these days but previously from overseas lending institutions.
Why do it? As the RBA puts it, “a reduction in the cash rate typically stimulates spending and inflation”.
According to Trading Economics, Japan has had negative interest rates for years and is currently at -0.1% while the central bank of Denmark is -0.6%, and Australia has been on a downward path since the late 90’s.

We’ll find out this week if the RBA will take further action with the interest rate, with a variety of commentators who know a million times more than we do saying they should and they should not, while the RBA has to balance what will happen when COVID-19 support slows against signs of stronger economic performance.
Late news: No change to RBA Cash rate which remains at +0.10%
 
Suburb Spotlight - Mountain Creek
Between Buderim and Kawana lies the family friendly suburb of Mountain Creek which is named for the waterway draining off Buderim into Mooloolah River. Originally to be called “Wicky Up”, the creek was used for rafting timber from the hillside to the depot on the river.
The area is split by the Sunshine Coast motorway with the new precinct of Brightwater to the south and the more established Mountain Creek to the north. The Brightwater community surrounds a spectacular lake and has a new Aldi, modern school, popular tavern and function centre as well as many reserves and bike tracks. Brightwater offers a range of land for sale as well as house and land packages that have been tailored to suit a wide variety of tastes and budgets.
The northern sector has larger allotments, older homes, and at the moment a lot of renovations going on. The Glenfields estate is here to the west while the TAFE and highly regarded state schools to the east, just behind Mooloolaba.
The ABS statistics from the last census also presented homes changed ownership approximately every 8.1 years, most occupations were professional and the population growth 60.7%.
As of October 2020, the median sales price of a 4-bedroom house in the suburb was $635,000. You can see in the graph below that towards the end of 2020 there was a significant spike in house prices which reflects the current Sellers’ market where there are fewer than normal houses available to purchase and more than usual buyers looking to purchase.

source: www.rpdata.com.au

Current Sales Market
Low interest rates, Government stimulus, interstate migration, COVID accelerated lifestyle choices, overseas travel restrictions, overseas buyers (but not China), low stock and increased buyer numbers have pushed up median house prices across the Sunshine Coast. The market commentators predicting property price crash in 2020 have done a 180 with many looking at the Sunshine Coast as possibly having double digit growth in median sales prices, possibly in 2021 else over the next 2 years.
• Terry Ryder at Hotspotting placed the Sunshine Coast in 1st place in the top 10 ‘hotspots’ for 2021;
• Nerida Crosby at realestate.com.au predicts a ‘boom year’ featuring a sharp acceleration in pricing;
• Westpac’s Hassan and Evans are calling it at 15% over the next two years for the national home price;
• CommBank’s Kristina Clifton is looking at 14% over the next two years nationally;
• CoreLogic (RP Data) reports a 2.5% increase in median price in February 2021, over 10% annually; and
• All the reports I’ve seen say houses are definitely seeing more gains than units.

With local and recent reports hard to come by I’ll show readers mine which has been collected every month for 5 years using the same methodology. It shows the last 12 months for Buderim median price moving from $595,000 Feb 2020 to a staggering $858,000 end of month Feb 2021. We see the frustration of the dozens of Buyers coming into the office every week and we see the delight of Sellers able to upgrade to their next home.

Current Rental Market
The current rental market on the Sunshine Coast is in high demand! We are still receiving a growing number of enquiries from the Southern states, which is driving up rental prices and the continual demand. Our local residents are being forced to pay premium rents, or sadly move out of the area to more affordable housing. Just with one property we have recently rented from the first inspection, we received over 200 enquiries and 23 groups arrived on the day lining up to see a 3-bedroom renovated townhouse in Mt Coolum! We rented it to a lovely family for $500.00 P/wk.